SP 500 Futures Intraday and NAVs of Certain Precious Metal Trusts and Funds - A Whiff of Fear

I would start shifting to a net short if the SP futures crack 1290 to the downside.

Until then I would rather be long gold and silver, including some miners, from the dip as mentioned yesterday, and use any stock index and other asset shorts to hedge positions in miners and perhaps silver.

The Net Asset Value Premium chart is included below.  There is hardly a bubble like activity in those premiums although the divergences are interesting.  They indicate a fear of a break in supply in the physical silver market in my opinion, and not just among retail investors. 

People in the trade know Sprott has the silver AND that they can take delivery of it if push comes to shove and they need actual possession of it for some reason.  There is no other way that I can explain this except as some arbitrage trade.  There must be a fairly sophisticated fear of a risk of a default in the silver bullion market and PSLV is being used to hedge that risk. At least that's my take on this, but I could be wrong.

The economic data continues to indicate a growing stagflation in the US.  Fresh information out of the European sector suggests that a 'retructuring' of sovereign debts may be coming.  The same could be said of the US, but its nice to own the ratings agencies and be providing liquidity lifelines to half the worlds multinational banks.  It adds a panache to one's financial profile,  and is certain to buy at least a few friends amongst TWCTF (those who control the flow).

There could be a cage match brewing between the Anglo-American controlled World Bank, and the European dominated IMF, especially if the BRIC's obtain some representation there.   In most cases of intense diplomatic discussion it is wise to follow the money, and war, including currency war, is continuation of diplomatic efforts by other means.

Carl Levin has referred Goldman Sachs to the SEC and the Justice Department for multiple counts of perjury and violations of various securities laws.   His YESness is trying to raise a billion dollars for his presidential re-election campaign, and those internet donations are not flowing freely from the masses.  So would you like to place any bets on a meaningful investigation and any forthcoming indictments?  Well apparently some are willing to make that bet.  Goldman CDS Jumps on Levin Claims

I'd rather bet that this is some variation of the Chicago-style extortion rackets, with a bait and switch kicker. Been there, seen that done last election. But make little mistake there is almost no one keeping almost anyone of size honest these days between the government and business. The Wall Street satanspawn have co-opted the process.

Without reform of the international trade regime and the imbalanced FIRE sector there will be no sustainable recovery.

Gold Daily and Silver Weekly Charts

A rebound today from the bear market raids of yesterday. The action in the miners intraday was a little obvious. When you can come in and move a market with 1000 share orders you know it is a thin trade. The premiums of CEF and PHYS went into the red intraday and provided a potential opportunity. Took it for a ride, but Your Mileage May Vary.

I had a thought today, that when they make the film about how silver caused the fall of the House of Morgan, that Tilda Swinton would be a good choice for the role of Blythe Masters. For ideas on how to depict the final default in silver, Tilda's last scene in the movie Constantine might offer some ideas.

It's too bad that Leslie Nielsen has passed away, because he would have been interesting as Jamie Dimon. Christian Bale or Dan Akroyd would probably be a good second choices. Hugh Laurie?

Gilbert Gottfried would probably be great as Lloyd Blankfein.  He could probably get it just about right.

The right hand side of the rounded inverse H&S curve in the gold chart was set today hopefully, showing support about where it would have been expected.

Silver remains resilient. QE is here to stay without regard to what antics the Fed may engage in, or what nice words the politicians may use to wrap that dead fish.

Without reform, particularly in the financial sector, there will be no sustainable recovery. The FIRE sector is a regressive tax on the real economy and offers a serious drag on the recovery.

SP 500 and NDX Futures Daily Charts

Nothing is quite broken yet.

JPM's numbers did not thrill the markets this morning.

Gold Daily and Silver Weekly Charts

Both gold and silver tested the expected support levels of 1450 and 40 today and held those levels successfully.

Let's see what new variations on a theme that the TBTF banks will have for us, even as they start trotting out their earnings tomorrow.